Page 119 - Introduction to Business

CHAPTER 2 The Environment of Business 93
6. Globalization does not
a. reflect the process of eliminating trade,
investment, cultural, and even political
barriers between countries.
b. reflect the growing links among people,
communities, and economies around the
world.
c. make it possible for goods, services, and
capital to cross national borders.
d. allow for the movement of labor and com-
panies across international borders.
e. force countries to live in harmony and
peace.
7. Regional integration does not include
a. creating a large pool of consumers with
growing incomes and similar culture,
tastes, and social values.
b. encouraging economies of scale in pro-
duction and increasing the level of com-
petition in industries.
c. freeing the flow of capital and labor to the
most productive areas.
d. increasing cooperation, peace, and secu-
rity among member countries.
e. developing a common official language.
8. Which of the following statements is not true
when you compare the United States with
the 25-member European Union (EU)?
a. The U.S. population is less than the EU
population.
b. U.S. income (PPP-based GNI) is less than
the corresponding EU income.
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c. U.S. per capita income (PPP-based GNI) is
greater than EU per capita income.
d. U.S. land surface area is greater than the
EU’s.
e. U.S. income (nominal GNI) is less than
the corresponding EU income.
9. Which of the following statements is not true
regarding conducting international business?
a. A wider range of opportunities is available
for entrepreneurs.
b. Firms generally refrain from entering
overseas markets because of unfamiliarity
with foreign cultures and business
practices.
c. Conducting business internationally is
not rewarding, both financially and
emotionally.
d. The risk involved in international busi-
ness is greater than in domestic business.
e. The risk-reward tradeoff depends crucially
on the type of international business
activity the firm chooses.
10. Which of the following is not a reason why
MNEs invest abroad?
a. To seek control of essential raw materials
b. To expand market and profits
c. To maximize production efficiency
d. To minimize control of their operations
e. To have access to foreign technology and
skills